From Briefing.com: 4:33 pm Semtech beats by $0.01, beats on revs; guides Q4 EPS above consensus, revs in-line (SMTC) : Reports Q3 (Oct) earnings of $0.37 per share, excluding non-recurring items, $0.01 better than the Capital IQ Consensus of $0.36; revenues rose 21.7% year/year to $140.9 mln vs the $137.93 mln Capital IQ Consensus.Non-GAAP gross margin was 60.4%Non-GAAP operating margin was 23.6%Co issues guidance for Q4, sees EPS of $0.33-0.37, excluding non-recurring items, vs. $0.33 Capital IQ Consensus Estimate; sees Q4 revs of $134-142 mln vs. $133.52 mln Capital IQ Consensus Estimate.Non-GAAP gross margin is expected to be in the range of 60.0% to 60.5%
4:31 pm Western Digital schedules Investor Day for Dec 6 to discuss ongoing strategic transformation, market positioning, growth opportunities and financial model (WDC) :
4:15 pm : The stock market closed a strong month on a sloppy note as the S&P 500 (-0.3%) spent the day in a retreat from its opening high. The benchmark index narrowed its November gain to 3.4% while the Nasdaq Composite (-1.1%) underperformed, but still added 2.6% for the month. The Dow Jones Industrial Average (UNCH) outperformed today, staying true to its November (+5.4%) form.
Equity indices entered the day with an assortment of positive headlines to rally behind, but what we saw instead, was a continuation of the selling that showed up during the last hour of yesterday's session.
The positive headlines from this morning included:
An official OPEC agreement to lower oil production to 32.5 million barrels per day
Better than expected economic data, which supports the narrative that a December rate hike makes sense and is not being rushed
News that Steve Mnuchin, who is known to be business-friendly, was nominated as Secretary of the Treasury
Report that the European Central Bank is likely to extend its quantitative easing program past March
In the end, only the OPEC-related news stuck, preventing the S&P 500 from ending well below its flat line. The energy sector (+4.8%) extended its November gain to 7.9% while crude oil soared 9.3% to $49.44/bbl, ending the month higher by 5.5%. The big rally in crude began in overnight action, before the results of the OPEC meeting were known. A short squeeze likely played a part in the rally, especially when taking into account yesterday's bearish headline flow. On a side note, today's OPEC deal will put monthly supply back at levels from the start of the year, when hopes for a supply cut were already driving daily price action.
Energy was one of just four pockets of relative strength on the sector leaderboard. Financials (+1.3%) and materials (+1.1%) also posted solid gains while industrials (-0.1%) ended just ahead of the S&P 500 thanks to strength in transport stocks after rail carrier CSX (CSX 35.83, +1.03) raised its guidance.
The financial sector extended its November gain to 13.7%, as the month-long theme of yield curve steepening continued. Selling in the 10-yr note sent its yield higher by eight basis points to 2.37% while the 2-yr yield rose two basis points to 1.11%. For the month, the 10-yr yield spiked 54 basis points while the 2-yr yield jumped 26 basis points.
Today's sharp uptick in Treasury yields weighed on rate-sensitive sectors. Utilities (-3.2%) retreated throughout the day while telecom services (-2.1%), consumer staples (-1.7%), and real estate (-1.2%) were under significant pressure from the start.
Elsewhere, the consumer discretionary sector (-0.9%) was pressured by losses in apparel retailers and homebuilders. The iShares Dow Jones US Home Construction ETF (ITB 27.34, -0.59) fell 2.1% after a disappointing Pending Home Sales report (+0.1%; Briefing.com consensus +0.7%), which made for a soft spot in today's batch of economic data. On the retail side, American Eagle Outfitters (AEO 16.56, -2.35) plunged 12.4% in reaction to disappointing guidance for the holiday period.
Two other influential sectors-health care (-1.0%) and technology (-1.2%)-kept the market under pressure throughout the day, and their underperformance was most notable when looking at the Nasdaq. Biotechnology was particularly weak, sending the iShares Nasdaq Biotechnology ETF (IBB 274.07, -6.24) lower by 2.2%. The biotech ETF narrowed its November gain to 6.8%.
Month-end flows led to increased participation as more than 1.5 billion shares changed hands at the NYSE floor.
Economic data included MBA Mortgage Index, ADP Employment, Personal Income/Spending, Chicago PMI, and Pending Home Sales:
The ADP National Employment Report showed an increase of 216,000 in November (Briefing.com consensus 160,000) while the October reading was revised down to 119,000 from 147,000.
Personal income increased 0.6% in October (Briefing.com consensus +0.4%), bolstered by a 0.5% increase in compensation of employees and a 1.8% jump in personal interest income.
Personal spending was up 0.3%, and while that was below the Briefing.com consensus estimate calling for 0.5% growth, it was essentially in-line with expectations when taking into account that personal spending growth in September was revised up to 0.7% from 0.5%.
Core PCE Prices increased 0.1%, in-line with the Briefing.com consensus.
The MNI Chicago Business Barometer checked in at 57.6 for November (Briefing.com consensus 52.0) versus 50.6 in October. The November reading marked the highest reading for the barometer since January 2015.
New Orders increased to 63.2 from 52.5
Pending Home Sales ticked up 0.1% in October (Briefing.com consensus 0.7%) and the September reading was revised down to 1.4% from 1.5%.
The weekly MBA Mortgage Index fell 9.4% after rising 5.5% last week.
Tomorrow, weekly initial claims (Briefing.com consensus 253K) will be reported at 8:30 ET while October Construction Spending (Briefing.com consensus 0.6%) and the November ISM Index (Briefing.com consensus 52.1) will cross the wires at 10:00 ET.
Russell 2000 +16.3% YTD
Dow Jones Industrial Average +9.8% YTD
S&P 500 +7.6% YTD
Nasdaq Composite +6.3% YTD
DJ30 +1.98 NASDAQ -56.24 SP500 -5.85 NASDAQ Adv/Vol/Dec 1023/1.82 bln/1881 NYSE Adv/Vol/Dec 1177/1.58 bln/1798
3:35 pm :
Clearly a big day in oil
WTI crude oil futures surged following OPEC agreement, but never broke the $50/barrel level
Jan WTI crude oil finished its floor trading +9.1% at $49.40/barrel, after rising as high as $49.90/barrel
In other energy, Jan nat gas closed +0.9% at $3.35/MMBtu
The dollar index rose today, which helped weigh on commodities overall today
Feb gold closed -1.4% at $1174.10/oz, while Mar 2017 ended -1% at $16.49/o
However, in base metals, Mar copper rose 0.8% today to $2.63/lb
When the bell rang on Wednesday, trading was at lows as a late session drop took all three major US indices to lows of the session. Ending the month on a down note, the lone index in the green today, the Dow Jones Industrial Average, managed to gain only 1.98 (+0.01%) to 19123.58. The Nasdaq Composite was down worse than 1%, lower by 56.24 points to 5323.68, and the S&P 500 lost 5.85 points (-0.27%) to 2198.81. The worst performing names the in Nasdaq 100 today, which contributed to the index's decline, included IMN -10.0%, BIOS -8.1%, HZNP -5.9%, TSN -3.7%, DF -3.2% and EBIX -2.6%. Shares of IMN were weaker today after peer Dataram (DRAM 1.17, -0.24 -17.02%) gained more than 40% yesterday, and todaygave up all of those gains.
Equity indices entered the day with an assortment of positive headlines to rally behind, but what we saw instead, was a continuation of the selling that showed up during the last hour of yesterday's session.
The positive headlines from this morning included:
An official OPEC agreement to lower oil production to 32.5 million barrels per day
Better than expected economic data, which supports the narrative that a December rate hike makes sense and is not being rushed
News that Steve Mnuchin, who is known to be business-friendly, was nominated as Secretary of the TreasuryReport that the European Central Bank is likely to extend its quantitative easing program past MarchIn the end, only the OPEC-related news stuck, preventing the S&P 500 from ending well below its flat line. The energy sector (+4.8%) extended its November gain to 7.9% while crude oil soared 9.3% to $49.44/bbl, ending the month higher by 5.5%. The big rally in crude began in overnight action, before the results of the OPEC meeting were known. A short squeeze likely played a part in the rally, especially when taking into account yesterday's bearish headline flow. On a side note, today's OPEC deal will put monthly supply back at levels from the start of the year, when hopes for a supply cut were already driving daily price action.
Among the weaker S&P sectors, Technology (XLK 47.50, -0.57 -1.19%) ended the session worse than 1% lower, shedding all of last week's gains. Component Activision Blizzard (ATVI 36.60, -1.35 -3.56%) was the worst performer today behind no particular catalyst. Other sectors as measured by the S&P closed the day split with XLE +5.08%, XLFS +2.19%, XLF +1.26%, XLB +1.07%, XLI +0.10%, XLY -0.84%, XLV -0.95%, XLRE -1.22%, XLP -1.61%, IYZ -1.96%, XLU -3.15% Energy and Financials closing higher, and Utilities shedding more than 3%.
In the S&P 500 Information Technology (795.89, -9.35 -1.16%) sector, trading was bad enough to fall below the $800-level as the sector ended at lows. Component Autodesk (ADSK 72.66, -2.60 -3.45%) was among the weaker names today after the company reported a strong Q3, but Q4 guidance fell short of market expectations. Other names in the space which closed lower today included GPN -2.89%, AVGO -2.80%, TSS -2.73%, EA -2.64%, EBAY -2.35%, V -2.31%, KLAC -2.23%, FIS -2.17%, INTU -2.08%, ADBE -1.99%, FB -1.95%, FISV -1.80%, GOOGL -1.73%.
Other news items among tech names:
GoPro (GPRO 9.98, +0.15 +1.53%) announced 'solid' holiday quarter sell-thru in the U.S. for its new HERO5 cameras. The company also announced the restructuring of about 200 full-time jobs plus the cancellation of open positions for a reduction in workforce of about 15%. Additionally, Tony Bates will depart his position as president of the Company at the end of the year.
Netflix (NFLX 117.04, -0.47 -0.40%) unveiled new a feature that will allow members to download certain content for on-the-go availability.
Finnair and IBM (IBM 162.22, -1.31 -0.80%) announced a first-of-its-kind agreement to utilize iOS enterprise apps from IBM to support the airline's overall digital transformation.
The Mahindra Group and IBM (IBM) announced the development of a blockchain solution that has the potential to reinvent supply chain finance across India by enhancing security, transparency and operational processes.
FLIR Systems (FLIR 35.93, +0.68 +1.93%) acquired Prox Dynamics for about $134 million in cash. The company anticipates the business and related transaction costs will be about $0.01 dilutive to its 2016 EPS.
Wi-LAN's (WILN 1.35, +0.02 +1.50%) North Star Innovations, Inc. entered into a settlement and patent license agreement with Elite Semiconductor Memory Technology. Financial terms of the deal were confidential.
Mastercard (MA 102.20, -1.62 -1.56%) introduced Decision Intelligence, a comprehensive decision and fraud detection service. The solution uses artificial intelligence technology to help financial institutions increase the accuracy of real-time approvals of genuine transactions and reduce false declines.
Nintendo's (NTDOY 30.83, -0.39 -1.25%) Pokmon Sun and Moon sold 3.7 million Nintendo 3DS units in the Americas in first two weeks. Those levels represent an 85% increase compared to Pokmon X and Y (launched in 2013).
Zayo Group Holdings (ZAYO 34.50, -0.21 -0.61%) to acquire Electric Lightwave for $1.42 billion in cash.
Ericsson (ERIC 5.12, flat) has launched Accelerated Network Build, a new solution to accelerate and streamline the network build process for operators to deliver a faster time to market with quicker return on investment.
SUSE has entered into an agreement with Hewlett Packard Enterprise (HPE 23.80, +0.06 +0.25%) to acquire technology and talent that will expand SUSE's OpenStack Infrastructure-as-a-Service (IaaS) solution and accelerate SUSE's entry into the growing Cloud Foundry Platform-as-a-Service (PaaS) market.
Palo Alto Networks (PANW 134.37, +0.79 +0.59%) announced the integration of its VM-Series virtualized next-generation firewalls with Amazon Web Services Auto Scaling and Elastic Load Balancing.
Intel (INTC 34.71, -0.60 -1.70%) appointed Tom Lantzsch as senior VP and GM of IoT Group and builds Automated Driving Group.
Superconductor Tec (SCON 2.98, +0.98 +49.00%) was awarded a $4.5 million DOE contract to improve HTS Wire for Next Generation Electric Machines program.
Science Applications (SAIC 82.57, -1.74 -2.06%) was awarded a contract that has a five-year period of performance and a total contract value of $156 million to support the joint staff j6 directorate's c4 and cyber program.
CSRA (CSRA 32.01, -0.44 -1.36%) was advised by Providence Equity Partners LLC that they have sold substantially all of their holdings of common stock in the Company.
Brooks Automation (BRKS 16.30, -0.25 -1.51%) disclosed the acquisition of Cool Lab.
In reaction to quarterly results:
Autodesk (ADSK) reported a better than expected Q3 loss per share of $0.18 on revenues which also came in ahead of market expectations yet fell 18.4% compared to a year ago to $489.6 million. For Q4, the company sees a worse than expected loss per share of ($0.39)-($0.32) and worse than expected revenues of $460-480 million.
Splunk (SPLK 57.62, +0.24 +0.42%) reported better than expected Q3 EPS and revenues of $0.12 and $244.79 million, respectively. For Q4, the company guided revenues above expectations at $286-288 million.
Companies scheduled to report quarterly results tonight/tomorrow morning: BV, BL, BOX, EXA, NQ, PSTG, SMTC, SNPS/XCRA
Analyst actions:
SMCI was upgraded to Buy from Neutral at DA Davidson,
SBAC was upgraded to Overweight from Neutral at JP Morgan,
AUO was upgraded to Buy from Neutral at UBS;
FFIV was downgraded to Mkt Perform from Outperform at Bernstein,
MANT was downgraded to Hold from Buy at Maxim Group;
CMPR was initiated with a Hold at Aegis Capital,
NVMI was initiated with a Buy at The Benchmark Company
